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US may sanction companies working on Russian pipelines

The US has threatened to sanction companies, including European ones, working on the Russian gas pipeline with economic and financial penalties. The US and Russia's relationship seems to be on a steady down slide. Could it be that the United States is now firmly insecure of its hold over Europe vis-a-vis Russia?

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The Trump administration on Wednesday hardened its efforts to prevent the completion of new German-Russian and Turkish-Russian natural gas pipelines by warning companies involved in the projects they’ll be subject to US penalties unless they halt their work.

The move will likely increase tensions in already fraught US-European ties as well as anger Russia.

US threatens to sanction companies involved in Russian pipelines

Secretary of State Mike Pompeo announced the administration is ending grandfather clauses that had spared firms previously involved in the pipelines’ construction from sanctions authorised by the Countering America’s Adversaries Through Sanctions Act, a 2017 law aimed at punishing Russia, in particular, for interference in US elections and other matters.

The move opens the door for US economic and financial penalties to be imposed on any European or other foreign company over the Nord Stream 2 and TurkStream projects, including those that had been working on the pipelines before the passage of CAATSA and had been previously exempted from the penalties.

Read more: Aftermath of NYT story: US firm on Russia but door open for Putin, says Pompeo

This action puts investments or other activities that are related to these Russian energy export pipelines at risk of US sanctions, Pompeo told reporters at a State Department news conference. Its a clear warning to companies. Aiding and abetting Russia’s malign influence projects will not be tolerated. Get out now or risk the consequences.

Pompeo took aim at the pipeline projects, calling them the Kremlin’s key tools to exploit and expand European dependence on Russian energy supplies that ultimately undermine transatlantic security.

US tries to strong-arm Europe

He noted that the United States, which has ramped up its own energy production under President Donald Trump, is always ready to help our European friends meet their energy needs. The US has already begun exporting gas, and some coal, to central and eastern European nations like Belarus, Poland and Ukraine.

The Trump administration has lobbied Europe, particularly Germany, to abandon the pipelines, which it believes put Europe under greater influence from Russia, which has used its energy exports as political leverage. Wednesday’s step comes as Congress advances legislation that would mandate the imposition of sanctions that had been authorised by CAATSA.

As Europe’s domestic gas supplies decline, the region is becoming more dependent on imported fuel. The almost 10 billion-euro ($11 billion) Nord Stream 2 project from Russia to Germany is being financed by companies including Royal Dutch Shell Plc, Germany’s Uniper SE and Wintershall AG and France’s Engie SA. Allseas Group SA is helping to expand the Turk Stream link.

US and Russian relations strained

US and Russian relations have been nose-diving recently.

Moscow has angrily told the US embassy to “mind your own business” after Washington’s diplomatic mission raised concern about curbs on media freedom in Russia. Russia arrests media reporters on many grounds but namely for treason and justifying terrorism.

Russia arrests media reportersRebecca Ross, the spokeswoman for the US embassy, on Tuesday expressed concern about a clampdown on journalists in Russia.

Read more: ‘Mind your own business’: Russia tells the US over media freedom row

A high-profile Russian journalist who became an adviser to the head of the space agency was detained Tuesday on charges of treason for allegedly divulging state military secrets, the country’s security service said.

Ivan Safronov, 30, worked for business outlets Kommersant and Vedomosti and was one of Russia’s most high profile and respected journalists reporting on defence. Moscow’s Lefortovsky court ruled to approve Safronov’s arrest for one month and 30 days, “until September 6,” a court spokeswoman said.

“Watching arrest after arrest of Russian journalists – it’s starting to look like a concerted campaign against #MediaFreedom,” tweeted Rebecca Ross, a spokeswoman for the U.S. embassy in Moscow.

“Mind your own business,” the Russian foreign ministry tweeted late Tuesday.

GVS News Desk with additional input from other sources

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